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The NY Times Tries To Demonize Gold
Right now it is $1,390 an ounce, but before the events in New York and Washington it was $280 an ounce,” he wrote. He added, “If the price of gold reaches $1,500 or a little over before you get this message, it’s still all right to buy it. – NY Times quoting Bin Laden
Some of you may remember back in like 2003 or 2004 when gold’s move up was starting to catch the eye of the mainstream media and CNBC’s Bob Pisani made the comment from his theatrical perch on the floor of the NYSE that “gold is the currency of terrorists.”
Enter the New York Times – where the truth goes to die.
The mainstream media has an obsession with demonizing gold. It’s the metal of terrorists; it’s a pet rock; you can’t eat it; it doesn’t pay interest…and now the NY Times is connecting the ownership of gold with Bin Laden. Why even bring this up? Bin Laden has been dead since 2002 (kidney failure) 2011.
Of course, the NY Times has morphed into little more than a propaganda mouthpiece for the elitist interests that control it. In that regard, the NY Times article associating Bin Laden with gold ownership reflects the growing concern of the elitists over the slow but steadily growing interest in precious metals ownership by the public.
But the U.S. Government’s policy of eradicating the legitimacy of gold as currency goes back the 1970’s. Discussion and education about gold as a currency was systematically eliminated from the educational system in the early 1970’s after Nixon removed any connection between fiat currency and gold.
As an economics major in undergrad (1981 – 1985), I took some financial economics courses. Gold was never mentioned. I studied financial theory at the U of Chicago B-school (1989 – 1991) from the same professors who wrote the finance textbooks I used in undergrad. No mention of gold in any respect, not even for historical perspective.
Now that gold’s long term bull market is beginning to re-emerge, articles which disparage if not vilify gold are appearing in “respectable” mainstream media publications like the NY Times and Wall Street Journal.
But if gold is no big deal, how come the Fed refuses to answer any inquiries about its dealings on gold: “Smith then asked Dudley whether the Federal Reserve has swapped gold with the governments or central banks of other countries. Dudley replied: “‘I can’t comment on individual customer kind of transactions.'” GATA.org
Perhaps if the NY Times et al were interested in digging up real news about gold, these publications would looking into the dealings by the U.S. Treasury and the Federal Reserve with respect to the 8,100 tonnes of gold allegedly held in storage at Federal Reserve vaults. If gold is no more than a “pet rock” that “just sits there doing nothing” (Warren Buffet’s comment about gold) why is the Fed intentionally non-transparent with respect to its trading activities in gold? After all, the Fed publishes daily disclosures about its trading activities in its U.S. dollar fiat currency.
These are of course rhetorical questions. In fact I would suggest that the anti-gold propaganda will increase in direct correlation with the next leg up in the gold bull market, which began in mid-January. After all, a properly informed and educated public is dangerous to the Government…
Would the New York Fed respond with such contempt to a similar inquiry from, say, The Wall Street Journal, New York Times, Reuters, Bloomberg News, or the Financial Times? The possibility of such critical and specific questioning about the Fed’s surreptitious intervention in the markets probably does not worry Fed officials in the slightest. At least such questioning has never happened before. – GATA
Valeant (VRX): The Short Seller’s ATM Machine
Valeant stock bounced today on the news that it had completed an internal review of its accounting issues with respect to revenue recognition and did not find any additional problems (Wall St Journal). Famous last words there…VRX announced that it intends to file its restated financials in its 10-K by the April 29 “drop dead” date to avoid triggering a default under its bank covenants.
This Company smells more like an “Enron-esque” situation every day. The revenue recognition issues connected to Philidor RX Services is just one of many issues. VRX is a literal “roach motel” of bad business decisions, unethical business practices and, most likely, embedded fraud.
The stock popped up 21% in pre-market when the news report hit the tape. As you can 
see from the graph to the right (click to enlarge), it’s been selling off since the initial spike. It’s likely that a few panic’d short sellers rushed to cover. However, I would bet most of the move up in the stock was triggered by a bevy of retail daytrader stock jockeys who thought it would be a good idea to chase momentum.
While the Company may avoid a technical default under its bank covenants, this does nothing to fix VRX’s deep-seated problems. It has $30 billion debt that was amassed from overpaying for its several acquisitions over the past few years. It has a self-assessed book value of $6.4 billion, or $18/share. BUT, after stripping away goodwill/intangibles, its book value is negative $32.6 billion. Too be sure, most of that goodwill is attributable the amount by which VRX overpaid for acquisitions, some of which it is already looking to unload.
One last point about the news that juiced the stock today. The Company’s declaration that its financials are now valid is based on a review of the matter conducted by a committee that was composed of VRX’s board of directors. In no way can the case be made that this review was in any respect independent or “arm’s length.” This is another trait of a Company that is on the ropes: self-declared exoneration.
Without a doubt, the path of VRX’s stock to much lower stock prices will be littered with news-driven price-spikes like today. This is why VRX stock is a short-seller’s ATM. Every spike can be shorted for short-term profits. Make sure to hold on to some amount of a “core” position in order to profit from the next eventual new-driven waterfall. This is how similar stocks before VRX – like Enron, Bear Stearns, Countrywide FInancial, etc – traded until they finally dropped below $10.
I have no doubt that beneath the mess, VRX has a core business that is profitable. But it is highly likely that core value of VRX’s enterprise is significantly lower that is implied by the current market cap. Currently VRX’s June $17.50-strike put options trade at $2 and have an implied volatility of 1.477. This is a staggeringly high implied volatility and it reflects an imputed 35% probability that the stock price will be below $17.50 by the June expiration of the put contract.
The only problem I have with the idea of shorting VRX beyond price-spike daytrades is that the idea has not received the full “Cramer endorsement,” meaning Cramer has not issued a table-pounding “buy, the market is stupid” recommendation. Other than that VRX is a daytrader’s dream ATM.
As The Fed Pushes Stocks Higher The Real Economy Continues To Contract
Contrary to the signal about the economy conveyed by the stock market’s prodigious move up in Q1 2016 after the initial 10% plunge, the U.S. economy continues to deteriorate – in some areas rather quickly. Zerohedge featured an article by someone named Nick Colas from some firm called Convergex in which the author promoted the idea that the U.S. economy was on balance still doing well. But his thesis lacked meaningful analytic depth.
His first premise was based on a measure of deflation he calls “the bacon-cheeseburger index.” Colas makes the assertion that the price of ground beef, bacon, and cheese has declined over the past year. But clearly Nick is must be fortunate enough to not have to do his own shopping. All three food items have risen over the last year, with ground beef – at least in the Denver area – up over 20%.
The likely reason Nick’s “index” is capturing “deflation” is that he is relying on the rigged Government price indices. If perhaps in his area of the country the price on these items appears to be lower, I would urge him to examine the package size. Many food manufacturers are reducing the size and weight of their packaging, giving the illusion that prices are not rising. Serious students of inflation measurement are well aware of the tactics employed by the Government CPI statisticians to cover up the true rate of inflation. The “bacon-cheeseburger” index sounds something more fitting for a Weigh Watcher’s 12-step program than for use as a meaningful barometer of economic activity.
In addition, Colas looks at used car prices as what he terms an “economic bellwether.” His assertion is that used car prices have “remained stable” since 2010. Wrong. I actually wrote a blog post about this a couple weeks ago. But here are the facts, sourced from Auto Remarketing: used car prices in March had their biggest price drop in three years. And here’s the unwritten headline, Nick: the only factor that has kept used car volume from collapsing is the unprecedented proliferation of the use of auto loans to fund used car purchases. Despite the prices dropping slightly, many people still consider purchasing used cars. Normally, these vehicles are much more reasonably priced than brand new vehicles, meaning that people can have more selection when they arrive at car dealerships. There are many car dealers in America. For example, those people considering a used car in Hutchinson, KS could always look at visiting Conklin Cars. Car dealerships offer a much better selection of vehicles, so they might be worth visiting to ensure your budget stretches as far as possible.
As a matter of fact, the price a buyer is willing to pay for a used car is more a function of the amount of debt the bank will extend to close the purchase. 130% loan-to-value loans are commonplace. But this is not indicative of an economy that is even equivocally healthy. This is a reflection of a Government-backed banking system that will loan to anyone just about any amount of money in order to promote the illusion of economic activity.
Nick’s last “off the grid” indicator of economic health is so silly that it’s not really worth time spent eviscerating it. It’s based on Google searches of “I want to buy a house” and “I want to buy a timeshare.” As we all know how much of an investment buying a house is, it may help make this decision easier by checking out this Roofstock Review and getting a better understanding of what there is out there in terms of housing options. Be sure to do your research and don’t rush into anything. Existing and new home sale activity did indeed pick up considerably after the 2008-2010 housing market crash. However, this was the result of over $2 trillion in printed money injected into the mortgage market by the Fed and several more trillion in Government-backed subprime mortgage issuance. However, despite this unprecedented official intervention in the housing market, home sales volume has peaked at a level that’s about 65% of the bubble peak.
Like auto sales, home sales and prices have been predicated on the amount of debt – and the cost of that debt – that lenders, backed by the Government (FNM, FRE, FHA, VHA, USDA), have been willing issue to homebuyers. Most of the housing market activity of the last 5 years has been the product of this artificial and unsustainable market intervention by the Fed/Government. The headline here is that the housing market is now starting to roll downhill.
Based on most private-sector originated economic indicators and indexed measurements of economic activity, the U.S. economy – along with the global economy – is quickly sliding into a devastating economic abyss. This is why the level of military belligerence, especially that emanating from the United States, has been escalating at an alarming rate. But here’s three basis indicators of economic activity that require no explanation and which certainly have a lot more fundamental validity that something that sounds like a menu gimmick at Burger King:
It was reported earlier today that factor orders dropped to a 5-yr low. In addition, the Institute of 
Supply Managment index for the NY region dropped to September lows, with the employment index plungin. If the Fed were to step away from its constant intervention in the stock market, the price lines all three of these graphs would rather quickly look like the a weighted rope dropped down the elevator shaft of the Empire State Building.
Buy Silver With Both Hands On This Manipulated Sell-Off
The monthly non-farm payroll report has become a fraud of epic proportions. The Government is claiming that 215k new jobs were created in March. In the goods producing category it claims that 37k jobs were created in construction. But there’s a problem with this – it doesn’t correlate with construction spending and housing starts:
Anyone who follows the housing market knows that for the last year that new housing starts – notwithstanding the conspicuous manipulation embedded in the Government’s reporting methodologies – have been largely driven
by multi-family dwellings (big apartment buildings). But the graph on the right shows that multi-family dwelling “starts” have been declining as well.
In other words, the Government would have us believe that 37k jobs in construction were created in March despite the fact that construction spending is in a downturn. It’s laughable. Keep in mind that the Census Bureau collects the data for the employment report, construction spending and housing starts. It’s no surprise that even its own data is inconsistent.
The same idea applies to all of the areas in which the Government is reporting there to be new jobs created except maybe healthcare. Healthcare has indeed been the one area of growth in the economy because Obamacare has triggered a massive increase in Government-backed healthcare spending which is being financed by additional Treasury issuance and a massive transfer of wealth from the middle class to the disadvantaged class and to all of the private companies associated with healthcare (big pharma, hospitals incorporated, insurance, etc).
I turned up the volume – regrettably – on Fox Business this morning after the jobs report because I wanted to get some amusement from listening to the so-called “experts” explain why the economy was supposedly producing an unbelievable number of jobs. Interestingly, Maria “Money Honey” Bartiromo was unable to disguise the look of total disbelief on her face in response to the employment report. Some dope by the name of Steve Moore tried to justify the data by claiming that the big reduction in the cost of gasoline has created higher disposable income for consumers to spend in discretionary areas – he specifically cited restaurants – which has offset the jobs loss in energy and mining.
Steve, where are you getting your views? The facts, unfortunately for you, do not support your thesis. For instance, retailers have been laying off thousands and closing down stores en 
masse since the end of December. As you can see from the graph to the left, the restaurant industry, like the retail industry, is shedding jobs hand over fist.
Steve, I would suggest that next time you spew your garbage on a public forum, you better do some fact-checking in case there’s some viewers who know the facts.
Then there’s financial services, which the Government claims added 15k jobs. Tell that to the several thousand who were fired last month from big Wall Street firms. Not sure where the Census Bureau found the 15k new jobs. I suspect that the data collectors turned over some rocks and made up the numbers.
And then there’s the biggest problem. The Government produces several different versions of the employment situation in one report. There’s the Household Survey and the Establishment Survey. Then there’s the U-3 report and the U-6 report, each of which shows substantially different unemployment rates. U-3 shows 5% unemployment and U-6 shows 9.8% unemployment. Which one is it? John Williams of Shadowstats.com has
tracked the employment reports for many years. His work shows that the true unemployment rate is well north of 20%. This is validated in the context of the massive number of people who are no longer considered to be part of the labor force.
Most of those close 100 million not in the labor force are the ones who “fell off” unemployment insurance and stopped looking for work. Many are now on welfare of some type. Since 2001, the number of people who “qualify” for Social Security Disability Insurance has more than doubled to nearly 9 million. They are considered not part of the labor force and there’s law firms who have built their practice around getting people qualified. Then there’s the student loan factor. If you can’t find a job, apply to an online university and get a student loan. Since Obama took office the amount of student loans outstanding nearly doubled from $700 billion to $1.3 trillion. Once you get approve for that loan, the Government does not have to count you as being unemployed.
The market response to the employment report is just as absurd as the report itself. The stock and the precious metals were slammed initially. If stocks and metals were hit because the employment report implies that the Fed will raise rates this year, then why has the S&P 500 and Dow rallied to go green on the day and gold and silver are still down $16 and 53 cents respectively?
Corporate revenues are showing no growth and GAAP net income has declined four quarters in a row. I’ve got news for the Government, when companies are not producing revenue growth and their net income declines, they get rid of workers, not hire them.
Gold has been hit for as much as $23 today and silver for 66 cents (over 3%). Currently silver is down about 51 cents to $14.94. The bullion banks have been having a lot of trouble getting silver to cooperate with their manipulative efforts. On many days when gold is being hit, silver will trade higher on the day. I suggested at the beginning of the year that buying silver now would prove to be the trade of the decade. I maintain that call 
and silver currently is up over 8% YTD. I would suggest that all sell-offs in silver should be bought. You can leverage your trade in silver with mining stocks. The latest issue of the Mining Stock Journal is now out and my current idea is what I believe to the best idea I’ve come across in 15 years (it’s gold exploration junior). You can subscribe to the MSJ by clicking on this LINK or on the graphic to the left.
You subscription will include the latest issue, the first two issues published – the March 4th debut issue features an emerging silver producing company and includes call option recommendations – plus a glossary of mining industry terms to help you better understand the research presented.
The New Issue Of The Mining Stock Journal Has Been Released
Here’s a snippet: “When I got off the phone with this Company’s CEO, my analytic instinct told me that this stock is a potential grand slam home run investment opportunity. While there are currently many highly undervalued junior mining stocks, I believe this Company is one of the best ideas I’ve looked at in 15 years of focusing on the precious metals sector. My assessment of the Company includes conversations with both the CEO and with a director of the Company.”
You can subscribe to the Mining Stock Journal by clicking on this LINK or by clicking on the graphic below. For now, I am distributing the previous two issues (March 4th was the debut issue) published. Each bi-monthly issue contains what I believe to be unique commentary and analysis on the gold/silver market plus a thoroughly researched mining stock idea – mostly juniors but I’ll present an occasional large cap idea, especially if I believe it presents a good short term trading opportunity.
Shadow of Truth: An Age Of Deception And Fraud
If you tell a lie big enough and keep repeating it, people will eventually come to believe it. The lie can be maintained only for such time as the State can shield the people from the political, economic and/or military consequences of the lie. It thus becomes vitally important for the State to use all of its powers to repress dissent, for the truth is the mortal enemy of the lie, and thus by extension, the truth is the greatest enemy of the State. – Joseph Geobbels, Hitler’s Minister of Public Enlightenment and Propaganda
Put it on CNN and it’s true. Perhaps one of the most baffling aspects of our system is the extreme dichotomy between perception and reality. Anything reported by one of the major mainstream news sources is gobbled up and accepted as the truth by a majority of Americans.
Dr. Paul Craig Roberts wrote a brief commentary which describes how news reporting is used to control our perceptions in order to ensure the public acceptance of the Government’s agenda: “Liberalism has helped to make Western people blind by creating the belief that noble intentions are more prevalent than corrupt intentions. This false belief blinds people to the roles played by deception and coercion in governing. Consequently, the true facts are not perceived and governments can pursue hidden agendas by manipulating news” – PCR, How They Brainwash Us.
The problem is, once you “see” the truth underlying the thick systemic facade of fraud and deception, you can’t “unsee it.” The monthly non-farm payroll report will be released on Friday. Every month market participants guzzle Maalox and sit on the edge of their seat in anticipation of the headline news release. It seems beyond silly that the financial world spends an entire day discussing and analyzing the employment report, which is fictitious in its entirety. Hell, the Government releases two different statistical versions of the employment report. Which one is it – the Household Survey or the Payroll Survey?
It doesn’t really matter because once the unemployment rate metric hits the tape, that IS the number. The truth is that the real unemployment rate is well over 20%. But when everyone discusses The Number, they use the reported number which is currently 5%. The process of reporting the monthly employment situation is extreme absurdity in its entirety.
In the Shadow of Truth’s latest “Market Update,” we focus on the gold and silver market – or the fraudulent paper version thereof. Like the monthly employment report, most market analysts base their assessment of the gold and silver market on the weekly Commitment of Traders report. Of course, it makes no difference that the data in the report is already three days old by the time the report is released. Neither does anyone seem to care that data in the report is compiled and submitted by three of the most corrupt banks in the world. Another interesting misconception is the use of the gold/silver prices on Kitco as the “spot price.” But that’s a fabrication as well…
Yellen vs. Mr. Magoo
I’m not sure which is more off the rails: the stock market bubble that is being inflated or the Chairman of the of the organization that is doing the inflating:
Hmmm…”Well, let me start — let me start with the question of the Fed’s credibility. And you used the word “promises” in connection with that. And as I tried to emphasize in my opening statement, the paths that the participants project for the federal funds rate and how it will evolve are not a pre-set plan or commitment or promise of the committee. Indeed, they are not even — the median should not be interpreted as a committee-endorsed forecast”
Is The Pullback In Gold Over, Part 2
The bullion banks/Central Banks seem to be having a problem pushing gold lower here. Nearly every evening (U.S. time zone) they take a sledge hammer to the price by dumping payloads of paper gold electronic contracts in the Globex trading system. But gold snaps-back typically after the London a.m. fix. They also try to hammer it about 25 minutes before the Comex floor trading opens, to no avail:
This graph on the left shows the spike up in gold that occurred at 9:05 EST today (the x-axis is MST). The banks tried to hit gold about 15 mins after the stock market open but failed.
The next graph shows the daily gold price since September 29, 2015. As you can see, gold appears to be consolidating 
after a pullback from the 20% move that occurred from early January to early March.
I find it amusing when the gold investment community starts whining about a price pullback after a big move in a short period of time. When is the last time the S&P 500 moved up 20% in 2 months? It looks like the momentum indicators are curling back up as well. The action in the HUI and the metals reminds of late 2005 and late early November 2008. I leave it to the reader to review that particular history to see if they draw a similar conclusion.
Note: I just got off the phone with the CEO of a junior gold mining company that is one of the best ideas from a risk/return standpoint that I’ve seen in 15 years of researching, investing in and trading this sector. There’s been a handful of time when I’ve smelled “grand slam” ideas – Aquiline Resources, Silvercrest Mines, Wheaton Minerals (which became SLW and Gold Wheaton), Osisko, to name some of the most memorable. I smell a grand slam in the making with this company. I’ll be featuring it this week in the latest issue of the Mining Stock Journal.
Is The Pullback In Gold Over?
The price of gold ran up 20% since the beginning of 2016 through early March. In response to “overbought” readings in the popular momentum indicators, the superficial gold commentators become short term bearish. Additionally, based on what appeared too be a heavy “off-sides” in the bullion bank net short position vs. the hedge fund net long position in Comex gold futures, per the Commitment of Traders report, the “big price correction” side of the ship deck became heavily mobbed with short-term timing forecasts.
About two weeks ago, I decided to roll up my shirt sleeves and dirty up my hands with the COT data compiled by my business partner going back to early 2005. What I found in terms the current net short / net long positioning between the bullion banks and the hedge funds might surprise a lot of observers. Of course, I presented the information to the subscribers of my Mining Stock Journal in the March 17th issue (along with a relatively undiscovered “de-risked” junior mining stock idea with substantial upside, risk-adjusted).
As it turns out, while the net short position of the criminal banks is above the average net short position from 2005 to present, it’s not even remotely close to the net short position historically that has signaled an imminent price-smash operation. Currently the net short position is 200k contracts. But the highest that net short since 2005 has been is well over 300k. The net short position was well over 200k for large portions of 2010.
In other words, while there is some concern that the cartel is set up to force the price of gold lower by bombarding the Comex computer system with paper gold detonators, the comparative historical statistics suggest that gold has lot more upside and the open interest has a lot of room to expand before the cartel is in a position to throttle gold lower.
In fact, a case can be made that the current pullback in the price of gold may be winding down – click on image to enlarge:
As you can see in the graph above, gold has nearly pulled back to its 50 dma (dark blue line) and the momentum indicators (RSI, MACD) have moved from “overbought” to a neutral position. The RSI may be actually be turning back up (green box).
As we’ve seen with official intervention in all markets, it’s nearly impossible to forecast directional moves with any degree of accuracy. However, there’s a case to be made that the cartel is having problems forcing the price of gold lower. On several occasions in the last two weeks, gold has been slammed in overnight trading only to snap-back. Monday was a prime example, as gold was smacked hard for $10 down to $1210 in Asian trading but bounced back to close nearly unchanged from last Thursday’s close of $1221.
The fact that Indian jewelers are still on strike and thereby choking off Indian imports makes gold’s resilience even more remarkable. At some point, India will have to start importing heavily in order to facilitate seasonal, festival-related gold buying in May.
Even more interesting is the behavior of the mining stocks. The HUI index ran up 83% from Jan 19 to March 16. A price correction had to be expected. While it looks like the miners are still vulnerable to a bigger price decline than the current 7% pullback, don’t forget that the HUI more than doubled between late October and December 31st in 2008.
I’m preparing to chat with the CEO of junior gold mining stock that has been largely unnoticed by U.S. investors, retail and institutional. But a strategic buyer recently bought a 20% stake in this company and also plunked down a considerable sum of cash for a 1.5% net smelter royalty. I will be presenting this idea in the next issue of the Mining Stock Journal, which should be out either Thursday or Friday. This issue will also include proprietary market commentary and other “goodies.”
Pending Home Sales Up 61% In The Midwest? You Can Not Be Serious…
In his latest commentary on the National Association of Realtors’ Existing Home Sales reports, John Williams of Shadowstats.com had this comment: “the quality of data underlying this series remains questionable, as seen in erratic reporting over the years” (Shadowstats.com). This speaks to my recurring assertion that the National of Association of Realtors’ existing home sales reports have become just as questionable as the Government-generated new home sales reports.
More fascinating to watch is the NAR’s chief clown, Larry Yun, vacillate between his justifications for worse than expected reports and his glowing promotion of better than expected reports. The volatility of both the NAR’s report and Yun’s commentary on these reports is become more unstable and erratic in the past 12-18 months. I have previously written several commentaries on this issue with detailed source-references supporting my assertions.
In this context, the latest “Pending Homes Sales” report is hardly worth commenting on. Perhaps the Zerohedge title of their announcement of the report sums it up succinctly: “February Pending Home Sales Surge By Most on Record Amid Midwest Miracle” LINK.
The “Midwest Miracle” involves an 11.4% seasonally adjusted annualized rate jump in pending home sales in the midwest region for February vs. January. What’s even more preposterous is “not seasonally adjusted” 61.4% moonshot in pending home sales in the midwest vs. January. Aside from data collections issues, the biggest source of potential error in occurs in the “seasonal adjustments” and the conversion of month to month and year over year seasonally adjusted data into an annualized rate. The NAR uses the same seasonal adjustment algorithm as the Government. Of course, every other privately compiles economic activity report is showing an economy sinking quickly into quagmire equivalent to that of 2008/2009, in direct contrast to the rosy Government and NAR data. Funny thing, that.
Perhaps most amusing is that when the NAR’s report miss expectations, Larry Yun attributes it to the weather. I guess the weather in the midwest was sunny and warm everyday in February…Of course, there’s nothing like “boots on the ground” reports from readers, like this one from southern Ohio (the midwest, by the way):
Another data point for you on the RE front Dave: I sold my home (in SW Ohio) this time last year. I listed it on Zillow with no realtor involvement. I reduced the price of the house by the imputed cost savings of not having a realtor -every one of which I ever met was a useless bullshitter. I had a contract in less than two weeks. The millennial couple who bought it (btw, a lot of house for a young couple) put NOTHING down. At closing I noticed their mortgage was about 103% LTV. The VA charges all kinds of fees and the buyers just rolled most of them up into the mortgage. On top of his 103% LTV note he still had to come up w/ 7 or 8 grand for other silly financing fees and pre-paids.
Anyway, I priced my house to sell and it sold -quickly. Some of my neighbors were greedy and listed theirs with useless realtors asking ‘mkt prices’ and they are STILL sitting unsold. On top of that, 3 builders built spec homes last summer and all 3 of those are also sitting unsold. What is going to happen when/if interest rates ever normalize?